1. Field of the Invention
The disclosure relates generally to the field of financial protection. The disclosure relates specifically to the field of fraud detection.
2. Description of the Related Art
The occurrence of fraud and related dollar losses is growing because it has been very difficult for the financial industry to detect bust out fraud using traditional fraud detection systems. Traditional fraud detection systems are typically applied in two ways: at the point of credit application (sometimes referred to as application fraud systems), or through ongoing monitoring by a financial institute of its consumer transactions compared against an established profile of that consumer's behavior (sometimes referred to as transaction fraud systems).
Application fraud systems were not designed to detect fraud that takes place after the consumer's application is approved and credit is granted (sometimes referred to as post-book fraud); consequently, such systems often prove ineffective in detecting post-book fraud. For example, if a consumer is opening an account in his/her own name intending to commit fraud in the future, application fraud systems may verify the consumer's identity without analyzing the likelihood of the consumer engaging in fraud after the account is opened. Similarly, transaction fraud systems are ineffective in situations when evolving types of fraud that take advantage of more than one financial institution.